Whose lobotomy am I paying this week?

Probably those of Washington politicos and 24/7 cable news anchors. But debate over healthcare continues:

Government Care is at least efficient, right?

Umm, can’t tell unless we try it. The president’s misguided analogy with post-office said as much: “It’s the Post Office that’s always having problems,” not the smartest thing he said, considering that U.S. post lost $4.7 billions last year, another indicator of inefficient government bureaucracy. On the other hand Medicare, medicaid and veteran’s health administration run quite efficiently.

Two reasons are behind this: (1) not as many people use medicare, medicaid or veteran’s health administration as private health care, and patient-doctor ratio is reasonable. (2) they don’t have to keep an eye on profits as private health providers have to. (Public health options don’t need to advertise, therefore they also gain a little unfair advantage when it comes to competition). However, during the enrollment increases in those programs (changes based on population growths, etc.), there were signs of fiscal stress on the system, showing that this combination is precarious at best.

As footnotes, there is efficacy through competition: tragic-comically, insurance companies arrive on scene before FEMA during Katrina. There are back-and-forth arguments over whether the efficiency of medicare is just a myth: here, here. Also, medicare, medicaid or private insurance never cover 100% of the bill, making this efficiency a bare mirage.

What is the current government healthcare spending like?

Indecipherable. Let’s break down Obama’s healthcare spending. The expansion of Schip (state children’s health insurance program) which subsidizes insurance for 6 million low-income children (twice vetoed by President Bush) cost $5 billion-a-year. It will be funded by increased tobacco taxes ($35 billion for next five years).

Medicare Advantage, insurance for the elderly cost around $100 billion dollars to taxpayers a year. If the government provide the coverage directly, instead of private insurance companies, the taxpayers will save 12%-15%. Where does that $15 billion go? The president said insurance companies just took it as profits. Insurers say they take it as a buffer for government’s inadequate reimbursements, which shifts the costs to the privately insured. The insured blame the uninsured for this loss. Economists, however, blame everyone for allowing excessive treatments.

To put the government spending (and potential spendings) into perspective, the U.S. spends $2 trillion a year for health care. President Obama’s proposed public option will cost around $1 trillion dollar over a decade to bring the 50 million uninsured into the tent, and $250 billion of such spending will be put on the federal deficit. However, in practice, the figure may not be as high because (1) it includes illegal immigrants, stubborn young adults who don’t think they need insurance and poor people who are eligible for Medicaid, (2) only those without affordable employer-provided insurance and those in small businesses not offering employer-provided insurance will qualify to Obama’s ‘public option’.

Does financial crisis have any bearing on the healthcare reform?

Definitely. On one hand, it makes current healthcare companies less willing to take risky customers and yielding way for a government-run system. A lot of people lost their jobs and employer-paid health-insurance. As many as 14,000 people are losing their health insurance every day because of job cuts, according to left-leaning Center for American Progress Action Fund. On the other hand, it will further strain the national debt already stretched by the bailouts. A better lesson will be about risk.

In both financial and medical sector, insurance companies insure against risk. By taking on those risky health care coverage, the government (or insurance companies) are forced to take on risk and thus needs to diversify the potential damage. They do so by raising everyone else’s health care coverage. That was how the housing babble began and AIG/Lehman Brothers/Merrill-Lynch all ended by with risky asserts that turned into defaults. Dieu merci.

So health insurance companies are naturally lobbying against Obamacare?

No. They are against a government agency providing ‘healthcare’; that is why there is so much hot air against Britain’s NHS which employs hospitals and doctors. However, in the U.S., the reform will greatly benefit health insurance companies. They will gain tens of millions of new customers because Americans would be required by law to carry health insurance. Pharmaceutical companies would sell more prescription drugs because more people would have coverage for drugs. Hospitals and doctors wouldn’t have to provide as much free care as they do now.

Their profit margins would go down a little, but unlike with the Clinton care, the healthcare lobby is currently for the reform. However, so much political backlash (in town-hall meetings, ha) currently comes from small-businesses with low-income workers, which will now have to provide some insurance. [In Obamacare, small business is defined as an establishment whose annual payroll is over $250,000 annually, so most small businesses will be directly effected].

What is wrong with legalizing euthanasia?

Nothing really, but must be heavily regulated? It depends on how you frame legalizing part: assisted suicide is one way to interpret it, while mercy-killing (a noble concept pioneered in those benighted Crusader days and still used on dying horses) sounds a sunny idea. However, regulating this euthanasia will be a logistical, theological, and political nightmare. Suppose we impose a minimal age before which one cannot seek state-sponsored euthanasia. What will happen to those with incurable diseases under that age?

Tragically termed ‘easy way out’, legalized euthanasia can easily mark the beginning of this slippery slope. However, on the other hand are precipitous laws banning suicide. The assisted suicides of terminal patients are legal in Belgium, Switzerland and the Netherlands; Oregon requires two doctors to confirm that the patient has less than six months to live to conduct euthanasia. A Swiss group Dignitas is currently in the news for ending the life of an ailing (but not dying) British composer in a suicide pact with his dying wife. Everywhere in the world, the debate rages more violently than ever: in France, Je Vous Demande le Droit de Mourir, a 2005 book by Vincent Humbert, who a car crash left “unable to ‘walk, see, speak, smell or taste”, became a bible for people supporting euthanasia; in the Netherlands, a Dutch doctor is underfire for assisting the death of a Catholic nun, who he assumed refused euthanasia for religious reasons. No case is black and white when it comes to euthanasia.

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